About myself

andy@almanor

For a lot of years, the real estate market at Lake Almanor was on the slow side of conservative. It may not be fair to call the market slow, but at times, that may have been polite. Properties that were worth what was paid for them held their values, but they didn't appreciate very quickly at all. An example is our first lot that we thought we got a very good deal on in 1990 at $24,000. It had been repossessed by a friend who gave us a good deal on it. When we finally got the money to build on it in 1997, it was worth only about $30,000. For the seven years, we realized a compounded annual appreciation of only about 3.25%. We built our first home there in 1997, and then decided to build our current home in 1999 that was finished in 2000. We put the first home up for sale, and got no reasonable offers. We brought the price down dramatically, to a point at which we would not fully recover our cost of building it, but still got no offers.

In late 2000, things started changing. We sold that home for what we originally thought it was worth, which was almost 40% above the low point. In 2000, we bought four lots at pretty cheap prices. Then the market went nuts. We sold all of those lots in 2001 and 2002, at prices averaging more than three times what we paid for them. I'd like to think that I was a real estate genius, but that's probably not completely true. Had I waited another couple of years, they would have redoubled.

In 2008, we put our big house up for sale for the appraised value of $1.4 million, and we still have not sold it. The market is depressed even more than in 2000, but rather than a lot of real estate being dumped cheaply, it seems to be just sitting and waiting for the market to recover. There should be a lesson somewhere in this history. Right now, you can buy a house like ours for a lot less than you could two years ago, and I'm pretty sure that the market will recover and put it back up even higher than it was. We are still willing to take a hit because we can buy other property today to replace it without a net loss on the exchange. If I could save a year or two's salary by buying today instead of in a year or two, I'd be inclined to do it, but I'm on the selling side right now.

Over the long term, Lake Almanor real estate has increased in cost (and hopefully value) by quite a bit. We have been discovered, and when compared to any reasonable vacation refuge of similar quality, Lake Almanor was a steal. It's still a good deal, but the days of cheap properties are over here.

My two cents worth... If you are thinking of buying a lot or home at the lake, or anywhere for that matter, do your homework. It is too easy to fall in love with the first lot that you see. It is equally easy to drive by a few lots and fall in love with one of them from the street. If you are going to build your home and live on the street, then driving by may be a good way of looking at them. We've learned to walk every lot that you can afford. When we did that, we ended up buying three in one week, but we walked fifty. Some of the ones that we walked were advertised as having a lake view, but the view had been long ago obscured by trees or another recently built house. The ones that we bought didn't look like much from the road, but as we walked around them, we found that some of them had a lot to offer in views that you couldn't see without working at it a little.

Unless you are truly a professional home builder, talk to a couple of them up here (Thomas & Bevis did our two houses, and my parents' house. Jim Thomas is now Jim Thomas and Son, and can be reached at 530-596-4364). I wouldn't put that here unless I could recommend him strongly. Figure out what style of home you want to build (and can afford), before you tie up a lot. If you are planning a sprawling one-story home, you need a large flat area to build on. If you like multiple stories or split levels, sometimes a lot with some slope to it can work out very well. Some lots pose a real challenge in building, and the money you save on the lot may all end up going to engineering and hanging the house on it. Do your homework and get professional advice; preferably from a couple of local builders who can work with you to put together a workable plan.

All that being said, the market is in a constant state of flux. When I first wrote this several years ago, the last hints of a recession were leaving. Now we are back in tough times again, and Lake Almanor mirrors the economy. Historically, the market has been strong, and I think it will be strong again. You can pick any one of the following reasons: 1) Lake Almanor has been discovered. 2) Lake Almanor still represents an incredible value versus Tahoe, and it's still a much quieter and laid back place. 3) There is a flight of capital out of the stock market into real estate -as one guy told me after he took a bath in the stock market, "If I can't walk on it, I'm not going to buy it." 4) Lake view properties in particular are becoming very scarce, and the area is building out.

We try to keep our fingers somewhere around the pulse of real estate up here, and we know several of the professionals who we feel do an excellent job (Tim, Jay, & Dennis top the list). If you have any questions or would like a referral, feel free to contact us at any time.